The tournament pay explanation is useful in an attempt to explain why
a. some corporate executives earn amounts higher than their marginal revenue product.
b. very few people actually earn the minimum wage.
c. political entrepreneurs can generate campaign contributions from businesses outside of their districts.
d. people with only a high school education earn less than those with college degrees.
A
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The federal law that prohibits, among other things, price discrimination that lessens competition, the use of tie-in sales, and mergers between firms that reduce competition is the:
A) Sherman Act of 1890. B) Clayton Act of 1914. C) Federal Trade Commission Act of 1914. D) Celler-Kefauver Act of 1950.
Oligopoly is a market structure characterized by ________ number of firms who behave ________
a. large, interdependently. b. large, independently. c. a few, interdependently. d. a few, independently.
Output for a simple production process is given by Q = 2KL, where K denotes capital, and L denotes labor. The price of capital is $25 per unit and capital is fixed at 8 units in the short run. The price of labor is $5 per unit. What is the total cost of producing 80 units of output?
A. $233 B. $525 C. $200 D. $225
Suppose a perfectly competitive cotton farmer can produce 10 containers of cotton at an output at which marginal cost equals marginal revenue. The price per container of cotton is $100 and the average total cost is $75. What is the profit or loss that
this cotton farmer is earning? A) $750 B) $150 C) $250 D) -$25